The assumption of Donald Trump To the White House in his second term he unleashed a wave of volatility in the markets, with strong falls in the main US indices. According to Bloomberg data, The S&P 500 retreated more than 6% since the beginning of its new management. In this context, a report of the Bank of America evaluated Latin America’s performance So far this year and presented its perspective on Argentina in relation to the region.
In that context, decided to maintain its positive assessment about Argentina and maintained his optimistic vision in relation to the two local actions he maintains in his wallet. “Argentina is the worst performance in Latin America so far this year (-11% in USD), after having exceeded last year. We believe that the ongoing macroeconomic recovery, disinflation and deregulation could unlock the country’s potential in many industries. We maintain a position raised in Argentina through banks and energy.”
It should be noted that the Bofa only maintains the weighting of Argentina in two actions: Pampa Energía (Pamp) and Grupo Financiero Galicia (Ggal). Both are losses of up to 9.9% in dollars. However, the percentage of Argentina’s participation in the portfolio of the American bank only represents 6%.
In a brief fragment, It emphasizes that the risks for Argentina are: political uncertainty, high inflation, exchange controls and exchange weakness.
Beyond Argentina, in perspective, Latam generated a good performance in investors that rose 13% so far this year (compared to the S&P500 that fell 4%) and the emerging markets that won the same figure. According to the perspective of the American Bank, the region “could benefit if a rotation of porpholians outside the US is materialized towards the rest of the world.”
Brazil: high rates and fiscal deficit press growth
From the bank they emphasize that, although the economy of Brazil He will face a slowdown this year and the way to the drop in fees will be more complex, The Government of Lula da Silva could continue with a fiscal deterioration in view of the elections in 2026. It should be remembered that the Brazilian market was beaten in 2024 (with a fall of the Bovespa of 30%), precisely due to distrust in Lula’s fiscal policy.
In this scenario, the Bofa maintains a defensive posture: “We balance the exhibition between companies that can develop well in a high seic rate environment and some quality companies that could overcome the market if the rates reach their maximum point this year.”
For its part, in a previous report, JPMorgan also pointed out some Brazilian Variable Income which could be attractive options to incorporate into the portfolio in 2025. Brazil approaches key moments, in view of the 2026 elections whose expectation is in a possible change of political sign.
Mexico pressured by Trump’s tariffs
According to the bank, Mexico is still very affected by the tariffs imposed by the US and the distrust of the market persists. “We consider that the only threat of tariffs will probably limit investments.” In that sense, the Bofa maintains a neutral posture with defensive options.
Chile and Colombia: The elections change the perspective of investors
Finally, Chile and Colombia will face a crucial period due to elections in both countries. The expectation of markets today looks at the possibility of changing political sign. According to the report, the Chilean market rose 19% in dollars while the promotion in Colombia was 23%. “We believe that the markets are beginning to reflect in their prices the possibility of governments most promised in both countriesconsidering the presidential elections of November in Chile and May 2026 in Colombia. In addition, depressed assessments suggest that the previous positioning was low. We maintain our exhibition in Chile through Santander Chile. “
In summary, although Donald Trump’s tariff policies could affect Latin American economies, foreign investors are identifying opportunities in variable income markets, although possible turbulence in the short term are not ruled out.
Source: Ambito
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